It’s a common thing that the Forex trading market operates 24 hours a day. This characteristic allows traders with Internet access to take part in trading processes, regardless of their location worldwide.
In this article, we are going to take a deeper look at the Forex market and its 24-hour accessibility for anyone who wishes. Also, you can check out our forex brokers list so that you can pick a reliable broker to trade with.
The Reason Behind 24 Hours Forex Market Trading
Let’s begin by noting the most evident reason: the demand for currency. Currency pairs enjoy significantly higher demand compared to other assets. This translates into more opportunities for profit through 24-hour trading. It makes sense since these markets offer greater potential rewards compared to stocks, bonds, commodities, and similar options.
When we examine the Forex trading schedules, we see that the market operates in 4 distinct time zones:
Tokyo – from 7 p.m. to 4 a.m.
New York – from 8 a.m. to 5 p.m.
London – from 3 a.m. to 12 p.m.
Sydney – from 5 p.m. to 12 a.m.
If the trading for a particular currency pair closes in one time zone, it continues in another. This arrangement with different time zones explains the ability for 24-hour trading.
Furthermore, Forex transactions are conducted in the digital realm, via devices. If they were done in a physical exchange, they would likely be restricted to regular working hours.
Understanding Forex Market Hours
These cities are designated as the centers for their respective time zones due to the presence of the 4 largest market exchanges. London and New York are generally recognized as the 2 most active time zones. Transactions conducted during their trading hours tend to be substantial. However, this doesn’t mean you should ignore the overlaps between Tokyo and Sydney markets. Actually, you should watch out throughout the entire trading process, as each overlap introduces market volatility that can lead to significant trade opportunities.
There is no competition among time zones and they work in harmony alongside brokers and exchanges. In case, you’re still looking for a broker, check HYCM broker as an example of reputable and safe broker to trade with.
Do Traders Need to Trade Forex 24 Hours a Day?
Actually, they don’t have to. Traders have the flexibility to choose when they want to participate in trading activities. They can decide on their trading hours based on their preferences, strategies, and time availability. Many traders focus on specific time frames or sessions that align with their goals and trading strategies.
Keep in mind that the 24-hour availability of the Forex market provides convenience and opportunities but doesn’t require traders to be active around the clock.
In conclusion, we will add that to get remarkable results in forex trading, constant monitoring of the market 24 hours a day is not a prerequisite. Success in this endeavor hinges on a few crucial elements: setting clear, specific goals, developing a strategy, and trading via a reputable broker as well.